11 November 2009

More Homebuyers Qualify for the Tax Credit

Congress just passed an expanded version of the $8,000 first time home buyer tax credit that was set to expire on November 30. The new version of the tax credit has the potential to stimulate the housing market even more than the old version due to the fact that more people will qualify under the new rules. Although the tax credit remains at $8,000 for home buyers that have not owned a primary residence in the last three years, it has been expanded to include a $6,500 tax credit for home buyers that have lived in their current primary residence for at least five consecutive years out of the past eight years. Under the old rules, move-up home buyers did not qualify. Consider the three examples:

Example 1:

Jane purchased a home in 2002, lived there for 5 years as her primary home, moved out in 2007, and turned that home into a rental property. If Jane decides to buy a new primary residence today, she would qualify for the $6,500 tax credit based on the fact that she lived in the same residence as her primary home for at least five consecutive years out of the past eight.

Example 2:

Harry purchased a home in 2004, and lived there for the past 5 years as his primary home. If Harry decides to buy a new primary residence today, he would qualify for the $6,500 tax credit based on the fact that he lived in the same residence as his primary home for at least five consecutive years out of the past eight.

Example 3:

Nicole purchased a home in 2006, and lived there for the past 3 years as her primary home. If Nicole decides to buy a new primary residence today, she would not qualify for the $6,500 tax credit based on the fact that she did not live in the same residence as her primary home for at least five consecutive years out of the past eight.

The tax credit applies to homes purchased for less than $800,000 before May 1, 2010. "If you sign a binding contract to purchase a home before May 1st, you would need to close on the transaction before July 1, 2010," Nicholas said. "It works kind of like a gift certificate that can be redeemed for cash. You simply file a form with the IRS right after you buy your home, and the IRS will send you a check for the full amount of your credit."

The income limitation for single tax payers went up from $75,000 under the old rules to $125,000 under the new rules. For married tax payers, the income limitation went up from $150,000 to $225,000. "This means that more people will qualify for the credit -- especially in parts of the country with higher costs of living," Nicholas said. "This should help stimulate parts of the housing market that may not have been impacted by the old version of the credit."

There are many creative ways of structuring your home purchase transaction in ways that maximize the benefits of the credit. Here are a few examples:

  • The credit applies to 1-4 unit homes as long as you live in one of the units as your primary residence -- you could live in one unit and rent out the others.
  • If two unmarried individuals buy a home, and only one of the individuals qualifies for the credit based on their income or past home ownership status, the individual who qualifies for the credit can claim full credit. (Note: In the case of married couples, both spouses must qualify for the credit.)
  • The credit applies even if you have co-signers on your mortgage loan.

14 October 2009

Deadline Soon for First-Time Homebuyers

Realtors, Mortgage Lenders say contracts need to wrap now to qualify for tax credit. by Stephen Maloney

Time is running out on the federal tax rebate for first-time homebuyers as the Dec. 1 deadline rapidly approaches, but real estate experts agree it's almost too late to begin the homebuying process and hope to qualify for the rebate of up to $8,000.

Essential Mortgage Co. President Mike Anderson said first-time homebuyers who haven't yet started negotiating a final price on a home are pressing their luck.

"You'd better get in contract by Oct. 15," Anderson said. "You better allow 45 days to get everything finalized. It can be done in 30 days, but I'll tell you what, you better have your ducks in a row."

Anderson said he closed a deal from start to finish within two days last year, but the regulations entacted by the federal government to avoid another housing meltdown have slowed the process considerably.

"We have a whole bunch of different waiting periods now," he said. "You can't hold an appraisal for three business days, you have the Home Value Code of Conduct with its own waiting periods. Things are just taking longer."

Realtors nationwide are asking Congress to extend the program for at least another year, Anderson said, but there is no indication yet whether the lobbying efforts are working.

The incentive itself, however, has attracted first-time homebuyers so far.

Metairie-based Re/Max Real Estate Partners agent Tom French said the tax rebate was the deciding factor in a home sale he put years of effort into closing.

"The first one I closed on I had been working on for three years," French said. "The night that Congress approved this program he sent me an e-mail and said, 'Ok, now it's time to get serious, let's buy that house.'"

That customer figured out exactly how much of a rebate he would qualify for and already had a purpose for the money in mind before he signed the contract, French said.

"He had it all planned out," French said. "When we did his closing he said, 'That tax money is going to be new flooring in this house.' For him it was a big incentive."

Covington-based Stirling Properties vice president Barbara Shelton said more than 350,000 first-time homebuyers have taken advantage of the rebate program since its inception Jan. 1, leading to a potential backlog of paperwork as the final deadline to stop accepting applications nears.

"You're going to be crunched by the end of November with all the delays we're having if you don't hurry up and get things under contract now," Shelton said. "The biggest holdup is underwriting."

Anderson said loan applicants should be prepared to produce a wide array of documents to loan officers or expect delays.

"I would have two years' federal income tax returns, two months' bank statements and your two most recent pay stubs," he said. "If you were in college, get your school transcripts and copies of your diploma. These are the kinds of crazy things we're asking for today."

The college transcripts are looked at as proof that a recent grad is responsible enough to attend class and are analogous to a good work record, Anderson said.

Obtaining the transcripts may take up to 14 days, though, so applicants should be prepared well ahead of time, he said.

"If you're looking at the process starting from making the offer, you need to be doing that right now, in the next week or so," Shelton said. "We're already in October,so time is really running out."

12 August 2009

Condominium Market Statistics -- 2nd Quarter 2009

Multi Family Market Statistics -- 2nd Quarter 2009

Single Family Market Statistics -- 2nd Quarter 2009

Home Prices Continue Rise Throughout Jefferson Parish

After reaching their highest average selling price since May 2006 in June, home prices on the East Bank of Orleans Parish dropped nearly 12.5 percent in July and were down compared with last year. Meanwhile, prices have risen consecutively since April throughout Jefferson Parish.

Year-over-year homes prices dropped in all but three areas in the New Orleans area in July; the East and West banks of Jefferson Parish and St. Bernard Parish, according to statistics from the Gulf South Real Estate Information Network.

Homes on the East Bank of Orleans Parish were selling for an average of $215,457, down from $263,458 in June and $246,313 a year ago. However, properties were selling faster at 102 days compared with 113 a month ago and 108 last year.

St. Bernard Parish saw a slight increase to $111,226 from $110,375 a year ago, but that figure was down from $118,847 in June. However, only 27 homes were closed on in July compared with 32 in June and 28 a year ago, while the average time spent on the market surged to 139 days compared with 92 a month ago and 82 days last year.

The East Bank of Jefferson Parish has seen the average selling price steadily rise 8.4 percent since April to $239,429 in July, up from $238,129 a month ago and $224,203 last year. Other market figures were also encouraging, with 159 properties sold, more than 156 in June but fewer than the 163 a year ago. Homes also sold faster at 83 days, compared with 86 a month ago and 88 last year.

The West Bank of Jefferson Parish also continued to see home prices rise for the third straight month to $155,355 in July, representing a 20.8 increase since April. July's average selling price was up from $146,068 in June and $148,601 a year ago. Properties for sale sat for an average of 71 days, fewer than 77 days a month ago and 85 days a year ago, while 72 properties sold, fewer than 87 last year.

The story was the same on the West Bank of Orleans Parish, which has seen its average selling price increase 20 percent since April. Homes were selling for an average of $179,477 in July, up from $177,762 in June but down from $185,665 a year ago. More homes were sold month over month -- 30 compared with 26 -- but fewer than last year, when 34 properties were closed on.

Prices throughout St. Tammany Parish were also down, with the eastern part of the parish seeing a 10 percent month-over-month drop and the western part seeing a 5.3 percent drop.

Homes prices in eastern St. Tammany Parish were down $185,189 from $191,472 in June and $206,307 a year ago, while the number of homes sold was also down to 74 from 90 a month ago and 99 last year. Properties were also moving slower at 110 days compared with 79 in June.

Western St. Tammany Parish also saw prices drop to $264,441 from $270,763 in June and last year's average of $279,328. More homes sold in July compared with June -- 142 over 137 -- but that was still less than last year, when 173 properties were closed on. Properties also moved slower in July at 102 days, compared with 84 in June and 85 days a year ago.

In the River Parishes, which is comprised of St. Charles, St. James and St. John parishes, the average selling price dropped after a three-month rise to $172,979 from $212,581 in June. July's price also was down from $192,643 a year ago. Fewer homes -- 64 -- were sold than the 66 in June and the 72 a year ago. However, properties were more stagnant longer, sitting on the market for 110 days, up from 105 a month ago and 108 a year ago.

neworleanscitybusiness.com 8/11/2009

29 May 2009

New Orleans asks: What recession?


NEW ORLEANS —— Chicago is “a wash,” says Jason Weyland, an architect who lost his Windy City job when his firm cut half its workforce earlier this year. So on this day Mr. Weyland - married, bespectacled, and crisp-suited - is on a job hunt in a city that, just a few years ago, many Americans had written off, irrevocably sold down the mighty Mississippi.

“It’s hard to believe, but New Orleans has become a legitimate city,” he says, riding the St. Charles Streetcar line to a promising follow-up interview. “It’s got jobs, great culture, history, and it’s a city where people walk, which I like.” As the anchor of Louisiana - the only state with positive employment numbers - New Orleans is back.

Drawn by its walkable streets, antique neighborhoods, and laissez-faire regulation, young American workers are flocking to the Big Easy to stay, sensing an opportunity to redraw the economy and at the same time be a part of something bigger: rebuilding the only major US city to be completely devastated by a hurricane.

In many ways, it’s a stunning and irony-laden turnaround for a city whose deep social inequalities were laid bare when hurricane Katrina flooded it 3-1/2 years ago. It’s too early to tell, though, whether New Orleans can build an urban economic model to help lead the nation out of its economic doldrums - or will wind up spinning downward on the tail end of the recession.

“New Orleans tends to zag when other cities zig,” says Michael Hecht, president of Greater New Orleans Inc., a regional economic development agency. “We’re zagging pretty good right now.”

“Think of it as the third act of our redemption story,” he adds. The irony “is that while the rest of the country is mired in recession, we have a chance to leapfrog and lead the country out of this economic mess.”

To be sure, New Orleans is far from perfect. It’s still the country’s murder capital, and social inequities and the failure of many poorer residents to return are evident in the weed-choked and snake-infested desert of the Lower Ninth Ward, where nearly 700 people died after Katrina roared ashore on Aug. 29, 2005. At the same time, tens of billions in federal recovery aid, along with state ethics reform and business-friendly tax packages courtesy of Republican Gov. Bobby Jindal, have hastened the city’s progress, some economists say.

The city’s relatively low population compared with that before Katrina has helped keep unemployment low, though the total workforce - 527,000 in the 10-parish greater metro area - still hasn’t reached 1980 levels.

The $14.4 billion federal levee-improvement project, a new $3 billion refinery on the city’s west side, the $500,000 renovation of the Jackson Barracks military base, and a $60 million downtown residential complex called 930 Poydras are all bucking the dreary national total for construction, which is down 13 percent from early 2007. Add to that a key port and a largely recession-proof shipbuilding industry that services mainly the Navy and the energy industry, and it becomes clearer why the city has been able to skirt economic, if not natural, storms.

“Among the places in the US that you can go, [New Orleans] is going to be one where there may be greater opportunities for employment,” says Baton Rouge economist Loren Scott, a veteran tracker of the New Orleans economy.

But entrepreneurs in New Orleans say the real reason the city has outperformed expectations is the human capital that has flowed into the city: a great migration similar to ones that cities like Portland, Ore., saw in the first half of this decade — young, highly educated, and socially conscious risk-takers looking for a “livable city” to make their marks on the world.

Some signs: Tulane and Loyola universities, despite recent hurricane shutdowns, are seeing record enrollments, and the anecdotal evidence is that many graduates, instead of leaving as they often did in the past, are sinking roots.

Two years ago, Fast Company magazine ranked New Orleans as one of the five slowest cities in the world, alongside Budapest. This year, the city had catapulted to become one of the world’s five fastest cities, according to the magazine’s editors. Despite risks of the recession overcoming the state’s gains (in March the metro area lost jobs - 1,100 - for the first time since Katrina), some economists expect Louisiana to have a net gain of 1,300 jobs by the end of the year, at a time when employment has been skidding in cities such as New York, Atlanta, Chicago, and San Francisco.

In late April, two major rating agencies upgraded New Orleans’s municipal bonds to investment grade for the first time since hurricane Katrina hit, citing “the city’s generally improving financial profile.”

Tourism and convention business has shown continued growth, partly based on what locals call the “AIG effect”: a rejection in corporate America of glitzy junkets in favor of “volun-tourism,” where convention attendees can spend a day helping citizens rebuild the city.

That sentiment has also spread to corporate investment in local businesses hoping to sell franchises, such as the all-organic Naked Pizza company.

And aside from Mardi Gras and Jazz Fest - both of which have boomed in the past two years - the city counted 14 neighborhood festivals on a recent April weekend, as this late-night city seems determined to roulez through the recession.

New Orleanian Scott Couvillon, who helps run a new “un-junk mail” marketing service called Dukky, says the city has become “an entrepreneurial petri dish” because of several factors: hands-off regulation, and “empathic” young people looking for opportunity and a “coarse existence” in a place famous for its paucity of social and city services.

In a warehouse in a run-down neighborhood on St. Philip Street, Robbie Vitrano has created a laboratory of his own: Dozens of websites are running here as part of his ad agency’s “venture marketing” effort helping start-ups conquer market share. Young cultural anthropologists and former corporate raiders work in an open, newsroom-style environment, overseen by a “Jolly Louis” flag - a version of the pirates’ skull and crossbones, showing Louis Armstrong against a backdrop of crossed trumpets.

“New Orleans has become a destination for a generation asking: ’What’s next?’ ” says Mr. Vitrano.

Katie Del Guercio left a corporate job in Los Angeles a year ago to find more meaningful work. She volunteered in New Orleans for three months and, after leaving for a trip to Europe and a stay with her family in New Jersey, she made up her mind: New Orleans would be her home.

“The city feels like a college campus for grown-ups trying to make things happen,” says Ms. Del Guercio, a manager with a progressive job-matching service called Koda.

Many city observers aren’t surprised. Errol Laborde, a local bon vivant and editor of New Orleans Magazine, likens the city’s comeback to two other historic milestones: the period right after the Louisiana Purchase and the tail end of Reconstruction, when thousands of people emigrated from the East Coast to find their fortunes in Louisiana.

“We’re seeing a similar combination of new money and a pioneer spirit in New Orleans today,” says Mr. Laborde.

But there are still concerns about the city’s current state of affairs and direction. Housing advocates say that in the process of courting a new workforce - whether college grads from other cities or Hispanic laborers - the city has focused less on helping the displaced and largely African-American population plug into the new jobs dynamic.

And while new apartment complexes are going up with the help of federal and state tax credits, the hardest-hit areas - the Lower Ninth Ward, New Orleans East, and Holy Cross among them - are still struggling to rebuild.

But even on the racial disparity front, there’s some good news: The city’s focus on charter schools is paying off with test scores showing a narrowing racial gap. “There’s a disconnect between the reality of the economy in New Orleans and the wage structure of the jobs it provides,” says New Orleans-based Kalima Rose, a senior associate at PolicyLink, a national advocate for housing equity.

But she’s also optimistic. “I’m thinking we’re going to see over the next four or five years a continued return of neighborhoods and historically displaced people who want to come home but are still trying to organize how to get the resources to do it,” she says.

As far as lessons learned, experts say, New Orleans does give a glimpse into how federal aid - whether recovery money or a major stimulus package - can spark localized growth.

On the other hand, Washington’s current policy trajectory - higher taxes for the rich and added regulation for industry - seems to run counter to the Louisiana experiment, which is largely based on lower corporate taxes and less regulation, especially for entrepreneurial enterprises.

Still, New Orleans can offer at least one glimpse into how to recover from an economic shock: In a word, insouciance, says Richard Sutton, a banker-turned-royal-cheesemonger-turned-New Orleans entrepreneur.

“Historically, New Orleans people don’t necessarily care what the rest of the world thinks or does,” says Mr. Sutton, whose St. James Cheese Co. has grown rapidly since he relocated here from London after Katrina. “People here are really asking: ’What recession?’ ”

27 May 2009

Chinese Drywall -- How Can You Know?

If you are going to have any home "tested" for Chinese Drywall, please use EXTREME caution. We do not allow our Licensed Home Inspectors to "test" for Chinese Drywall. There are simply too many variables and way too much information (some correct and most incorrect) circulating about Chinese Drywall.

Testing can be complicated. The time the drywall was shipped to the home, installation of the drywall product, humidity or moisture in the air currently and the type of repairs needed, can each affect the test results.

An initial, intensive screening (performed by a microbiologist or other qualified personnel) should be undertaken in each room of the house. This screening should include air sampling both inside and outside of the home, including inaccessible areas like inside wall cavities and the attic. It should incoporate visual inspections of corrosion that may confirm a serious condition. It should also include a health profile in order to identify physical reactions by occupants to contaminants inside the house.

Upon completion of the screening, the client should receive a verbal explanation of the results and a copy of the screening report (this document will be critical should any legal claim progress). The client would know at that point whether the home contains contaminants from Chinese Drywall and the extent of the problem, should it exist. If there is a problem, the client should contact an attorney. Based on the level of contamination, the client may consider vacating the property.

If you don't have an attorney, we can recommend one of several local attorneys handling Chinese Drywall litigation. We will recommend that the attorney contact us so that we can discuss the estimated cost to remediate the property versus the cost of the full Chinese Drywall test. This additional testing is required to prove the claim in court. Understand that in order to comply with laboratory requirements in a full test, a 12" x 12" sample of drywall must be taken from each spot at which the compounds were registered. Each sample would be at a prepaid cost to the homeowner of between $1,200 and $1,800 per sample, plus labor. Because the sample size is 12" square, substantial disruption to the house will occur as a result of the testing. We are concerned that gases, previously inside the walls, now have a means of escaping into the home, entering breathing space and potentially complicating health issues.

We are prepared to support our finding in both Federal and State court. Both the President of our company and our Microbiologist are classifed as "expert witnesses" in either court.

Our concern is first and foremost, the client's safety. Please make sure qualified people are performing appropriate tests to determine if a hazard exists. Call us at 504-486-8500 for more information.


Mit Miller

Office Manager

Gurtler Brothers Consultants

08 May 2009

Mortgage Rate Drop Fuels Refinancing Boom

Home loan borrowers are cashing in on historically low mortgage interest rates as a refinancing boom gains momentum.

National mortgage refinance statistics jumped again for the last week in March -- up 3 percent from a week earlier and up 68.8 percent for the week ending March 27, on a year-over-year basis.

That news from the Mortgage Bankers Association represented a glimmer of hope for those waiting for a real estate market turnaround.

Borrowers making 20 percent down payments, for example, were able to qualify for 30-year fixed-rate mortgage rates of 4.61 percent on an average, down from 4.63 percent the previous week. Point -- an upfront fee mortgage companies charge for a specific interest rate -- also decreased to 1.03 from 1.13, including the origination fee.

That rate, the MBA said, is a new record low for the survey, which dates to 1990.

Most Road Home applicants choosing to stay in region

Most Road Home applicants in the New Orleans area continue to choose to stay in the region -- or at lease keep their property -- according to the latest figures from the recovery agency.

Of the 137,112 applicants in the New Orleans area as of March 26, 101,275 have chosen to keep their home, while 13,684 opted to sell and stay in Louisiana and 2,214 chose to sell and leave the state.

Orleans Parish had the most closings statewide with 44,343, representing 35.9 percent. Jefferson Parish was second with 24,028, and Calcasieu had the third most with 12,478.

Other New Orleans-area parishes report the following closing totals through late March:

  • St Bernard - 11,438
  • St Tammany - 10,711
  • Plaquemines - 2,928
  • St John - 1,181
  • St Charles - 943
  • St James - 357

The New Orleans area consists of Jefferson, Orleans, Plaquemines, St Bernard, St Charles, St James, St John and St Tammany parishes.

State hikes elevation grant limit to $100K

The state is increasing the maximum size of elevation grants funded by the Hazard Mitigation Grant Program from $30,000 each to $100,000.

The program is funded with $750 million in HMGP money from the Federal Emergency Management agency to provide gap funding for homeowners who are raising their homes after hurricanes Katrina and Rita and whose elevation costs exceed the amount of funding The Road Home program provides them.

"It will definitely help because a lot of people had thought about raising but haven't because they couldn't afford the difference between $30,000 and what it would cost them (to raise)," said Marge Garvey, New Orleans Metropolitan Association of Realtors president. "I think for people who are worried about buying a slab, it will help sell the property."

Letters have gone to 3,366 homeowners in the the program about their eligibility, notifying them of the change. Another 25,000 letters will be sent out by the middle of May.

Foreclosures Grow Locally, Impact Minor

Real estate agents tracking whether home seizures will decrease property values.

In the numbers game of foreclosures, Louisiana has been bucking the trends in some areas and leading the nation in others.

As the statewide number rose 40 percent from 485 in January to 678 in February, foreclosures nationwide rose only 6 percent from 273,193 to 290,631, according to Irvine, Calif. - based RealtyTrac.

But while Louisiana far outpaced the nation during that time, local experts agree foreclosures are making limited waves in the comparatively healthy New Orleans real estate market.

"In the marketplace we're in, foreclosures are an issue," said Ross Miller, president of Metairie-based Miller Home Mortgage. "We are doing more purchases in which the house being bought is a foreclosure. That is up probably 10 percent. Where we would maybe do one every six months, now we're doing one a month."

Any increase in the number of foreclosed properties can spark a chain of events leading to lower property values, Miller said.

Owners trying to unload a home to avoid foreclosure are left with rapidly diminishing options if prospective buyers lower their offers before foreclosure proceedings begin, which Miller said can reduce the final sale price. Since appraisers and assessors use a comparison of the sales price of similar properties to determine the value of homes in a given area, those artificially reduced sales prices can have an extended effect.

"When you are trying to appraise a current piece of property, the appraiser pulls up the comparables," he said. "If you've got a house that's 2,000 square feet and you're comparing it to a house that's 2,250 square feet that should have sold for $280,000 but it sells for $240,000, it brings the whole neighborhood down."

Ben Maygarden, chief deputy for the New Orleans 6th District Assessor Nancy Marshall, said the effects of foreclosures are limited by safeguards within the assessment process.

"We don't normally reassess everything every year," Maygarden said. "Theoretically, and there is a difference between theory and practice, you're supposed to use that quadrennial assessment appraisal for the next four years."

If a house appraised at $200,000 for the 2008 assessment is sold within four years at a lower rate for whatever reason, the original 2008 assessment should be used until the next assessment, Maygarden said.

"In practice it does change, but that wouldn't necessarily produce a change for anybody else," he said. "The way the system is set up, it limits the effect on property assessments in a normally appreciating environment. They didn't really envision a situation where you had dropping property values, so the theory doesn't work very well when prices are dropping."

Even though the 6th District sports some of the highest concentrations of foreclosures in Orleans Parish with 80 near the convergence of St. Charles and Napoleon Avenues, Maygarden said the number of homes in the district diffuses the overall effect.

"We have about 17,500 properties in our district, residential and commercial," he said. "That's about one half of 1 percent in foreclosure...If they were evenly spread out across the district, we wouldn't see that as a sufficient reason to do a reassessment."

Marshall said the ultimate effects of foreclosures are not reflected in current home values, showing the gap between the number of foreclosures and home assessments.

"The value of homes is going up in New Orleans, which is somewhat inconsistent with foreclosures," Marshall said. "It's really more of a real estate transaction than an assessment."

Maygarden said there is plenty of anecdotal evidence of sales prices dropping due to foreclosures but the rising home values don't bear out Miller's concerns.

"We can't use unsold property prices as data," Maygarden said. "We have to use what thing sell for, as we have not seen a significant decrease in sales prices. And if we have, it's only been very recently."

by Stephen Maloney

20 March 2009

Pathway to Homeownership Soft-Second Mortgage Loan Program

Own a Home. This is the Path.

Receive up to $65,000 soft second home mortgage at 0% interest.

100% forgivable in 10 years with continuous owner occupancy; payable only upon sale or refinance.

Up to $10,000 closing cost assistance grant also available.

Eligible Properties:

*One or two unit residences within one of the Orleans Parish Housing Opportunity Zones (see map on http://www.financeauthority.org/), or when the residence is part of the New Orleans Redevelopment Authority (NORA) Re-development Portfolio or when the seller can demonstrate at least $5200 of damages realized from Hurricane Katrina and/or Rita within Orleans Parish

*Maximum Property values: One unit, either New or Existing: $289,704; and Two unit, Existing Only: $370,884

*All properties must meet City Building Code and Zoning Code requirments as well as the physical standards and inspection procedures of FHA/VA, Fannie Mae or Freddie Mac mortgage loan product chosen by the borrower

*Newly constructed, reconstructed or renovated homes are eligible. Modular or panelized construction is also eligible

Eligible Borrowers:

*Have not owned a home within the last 3 years or no longer own your home because of a divorce or death of a spouse

*Have not received payments from Road Home under the 'sell' or 'relocate' option *Family incomes at or below the following:

1 person $50,280

2 persons $57,360

3 persons $64,560

4 persons $71,760

5 persons $77,520

6 persons $83,280

7 persons $89,040

8 persons $94,680

*12 Hour homebuyer education required

*Minimum personal investment of 1% of purchase price or $1500, whichever is greater

Steps to Buying Your New Home:

1. Visit the Finance Authority of New Orleans website to learn about the program at http://www.financeauthority.org/.

2. Gather your financial information: tax returns and W-2s for the last three consecutive years, pay-stubs within the last three months, financial documents related to all your sources of income, listing of all real estate investments, listing of all investments in stocks and/or bonds, listing of the balances due to any creditor or for any credit account owed.

3. Determine the first mortgage loan amount you can afford. You can do this by registering with a homebuyer training organization OR visiting a participating lender (see a list of homebuyer training organizations and participating lenders at http://www.financeauthority.org/). OR, you can complete a pre-application at our website http://www.financeauthority.org/ and a home counselor will call you.

4. Register with a participating homebuyer training organization certified by the Louisiana home-buyer Training Collaborative, Inc. and take the required 12-hour homebuyer education and training course. See our website for a list.

5. Complete a loan application with a participating lender. Please bring all documents gathered in step two to the participating lender.

6. Negotiate an Agreement to Purchase a home with the seller of a home in a Housing Opportunity Zone OR with New Orleans Redevelopment Authority (NORA) OR with a seller within Orleans Parish who can demonstrate $5200 of Hurricane Katrina/Rita damage. You should seek the assistance of a realtor in negotiating the agreement to purchase.

7. Close on your new home loan.


To learn more about the Pathway to Homeownership Soft-Second Mortgage Loan Program, call (504) 524-5533 local or (877) 524-5533 toll-free

This home mortgage loan program is made possible by Louisiana Recovery Authority, State Office of Community Development, City of New Orleans & The Finance Authority of New Orleans. The Finance Authority does not discriminate on the basis of age, sex, religion, national origin, physical handicap, political or union affliation. No person, solely on the basis of any of the above factors, shall be excluded from participation in, be denied the benefits of, or otherwise be subjected to discrimination under the loan program operated by The Finance Authority of New Orleans. Effective Date: February 18, 2009

02 March 2009

What you should know about the First-Time Homebuyer Tax Credit

The American Recovery and Reinvestment Act of 2009 features an $8,000 tax credit for first-time buyers who purchase a home on or after January 1, 2009 and before December 1, 2009.

Details of the tax credit include:

*The temporary credit is only available for home purchases made from January 1, 2009 to before December 1, 2009 and is equal to 10 percent of the cost of the home, up to a maximum credit of $8,000. (For example, a home purchased for $80,000 or more would qualify for the full $8,000 credit while a $70,000 home would only qualify for 10 percent, or $7,000)

*Only first-time homebuyers can take advantage of the tax credit. A first-time buyer is defined under the tax credit as an individual who has not owned a home in the last three years. For married joint filers, both must meet the first-time homebuyer test to take the credit on a joint return.

*There are income guidelines on the credit. Individuals with an adjusted gross income up to $75,000 (or $150,000 if filing jointly) are eligible for the full tax credit. The credit is phased down for those earning more and is not available for those with an income above $95,000 (or $170,000 if filing jointly).

*Buyers claim the credit on their federal tax return to reduce their tax liability. If the credit is more than their total tax liability for that year, the buyer will get a refund check for the balance.

*Eligible properties include anything that will be used as a principal single-family residence -- including condos and townhouses.

*The new tax credit does not have to be repaid if the buyer stays in the home at least three years. But if the home is sold before that, the entire amount of the credit is recaptured on the sale. People who purchased homes under the 2008 $7,500 tax credit program will still be required to repay that credit to the government over a 15-year period.

New Orleans Real Estate Market Not as Bad as Some Others, Experts say.

Kate Moran, The Times-Picayune February 27, 2009

While the volume of home sales plunged across greater New Orleans in the past year, real estate here has not suffered the freefalling prices and rampant foreclosures that have chilled the economy in California, Florida, Arizona and other hothouse markets.

Two local real estate experts who spoke Thursday evening at a forum sponsored by the Home Builders Association of Greater New Orleans gave a relatively strong prognosis for housing in this region, where the tide of insurance and recovery grants have helped insulate the economy from national pressures.

"It did not start here, and it is not very deep here, " Arthur Sterbcow, president of Latter & Blum, said of the housing crisis.

Home sales plunged last year across the metro area to 1,200, down from 1,900 the year before Hurricane Katrina and 2,200 the year after the storm, according to Sterbcow. At the same time, the inventory of homes listed for sale has started to fall in recent months, indicating it could become easier to sell a home.

Sterbcow noted that the gap between the supply of homes on the market and the number of buyers looking to snatch them up has started narrowing, and in many parishes the divide is smaller today than it was during the oil bust of the late 1980's. Mandeville is one of the few areas where the gap is greater now than it was then.

Yet neither Sterbcow nor real estate consultant Wade Ragas predicted a boom year for the home builders who formed their audience Thursday night. As the supply of new homes, especially on the north shore, continues to outstrip demand, builders have curtailed the pace of new construction. A number of them, unable to find buyers, have lost newly build houses to foreclosure.

Ragas, a retired University of New Orleans professor, said demand has slackened because many of the high-paying jobs tied to the oil and gas industry left the region after Katrina. The problem is not that builders saturated the north shore with too many homes, he said, but that potential buyers moved to other cities after the storm.

Ragas noted that the region has 68,000 fewer jobs today than it did in July 2005.

"The only way to fix an over-supply is to stop building, " he said. "You are doing what's needed to get back in balance, it just hurts like hell."

Ragas told the home builders that the recession infecting the American economy is the worst since the Great Depression. While he expected to see glimmers of recovery after President Obama's stimulus plan had a chance to take effect, he predicted the economy would make a second drop some time in 2010.

"This is the worst since the 1930's. There is not much question of that," Ragas said. "But it does not have the ferocity of the 1930's."

In New Orleans, he said, the nation's economic troubles would have the most dire consequences for the tourism, hotel and restaurant industries. The region has fewer residents but more restaurants than it did before the storm, a mismatch that would likely force some eateries out of business in the coming years.

Ragas also predicted some troubles in the apartment sector in New Orleans, which he said has become overbuilt since the storm. While the cost of construction remains somewhat high, consumers cannot afford rents at a level that will produce a large return for developers, he said.

At the same time, Ragas saw positive signs in the fact that insurance rates for single-family homes have begun to come back down to earth in greater New Orleans. Ragas praised Louisiana's insurance commissioner, Jim Donelon, for not making the same threats that recently drove insurance companies out of Florida. Sterbcow concurred.

"We have made great strides on insurance," Sterbcow said. "It's high but palatable."

It is another affirmative signal for greater New Orleans that the foreclosure crisis has amounted to a "non-event" here, he said. Less than half a percent of all households in Louisiana had a home caught up in some stage of foreclosure at the end of 2008, compared to 7 percent of all households in Nevada and 4 percent of all households in California, Sterbcow said, citing figures from the research firm, RealtyTrac.

Awful as Katrina was, Sterbcow was thankful that the storm hit three years ago rather than today.

"Can you imagine if Katrina had hit us this August, in this economy?" he said. "It hit us at a time when it was survivable for us."

09 February 2009

Luxury Property Statistics

Luxury Property
MLS Areas 60,62-67/All Brokers
Residential Sales greater than $900,000

2001 - 9 Sold

List PriceSale Price$SP/SFDOM
Avg: 1,260,000 1,270,000209.1076
2002 - 17 Sold
List PriceSale Price$SP/SFDOM
Avg: 1,556,588 1,407,965219.2098
2003 - 20 Sold
List PriceSale Price$SP/SFDOM
Avg: 1,272,200 1,299,714211.8435
2004 - 22 Sold
List PriceSale Price$SP/SFDOM
Avg: 1,450,413 1,283,080248.2860
2005 - 30 Sold
List PriceSale Price$SP/SFDOM
Avg: 1,483,483 1,399,380252.7989
2006 - 42 Sold
List PriceSale Price$SP/SFDOM
Avg: 1,401,232 1,307,201255.4560
2007 - 34 Sold
List PriceSale Price$SP/SFDOM
Avg: 1,421,147 1,352,838264.3668
2008 - 26 Sold
List PriceSale Price$SP/SFDOM
Avg: 1,674,538 1,542,303278.52107

This representation is based in whole or in part on data supplied by the New Orleans Metropolitan Association of Realtors, or their Multiple Listing Services. Neither the Board, nor the MLS guarantees or is in anyway responsible for its accuracy. Data maintained by the Board, or its MLS may not reflect all real estate activity.

06 February 2009

MLS Statistic Reports


Uptown / Garden District Area
MLS Activity / All MLS Brokers

Single Family Residential -- Areas 60,62-66

Units SoldVolumeAvg. Price/SFDOMAvg. Sale PriceHigh Sale Price
Area 62
Units SoldVolumeAvg. Price/SFDOMAvg. Sale PriceHigh Sale Price
Area 63
Units SoldVolumeAvg. Price/SFDOMAvg. Sale PriceHigh Sale Price
Area 64
Units SoldVolumeAvg. Price/SFDOMAvg. Sale PriceHigh Sale Price
Area 65
Units SoldVolumeAvg. Price/SFDOMAvg. Sale PriceHigh Sale Price
Condo Uptown -- Areas 60, 62-65
Units SoldVolumeAvg. Price/SFDOMAvg. Sale PriceHigh Sale Price
Warehouse District Condo -- Area 67
Units SoldVolumeAvg. Price/SFDOMAvg. Sale PriceHigh Sale Price
Multi-Family (5 Units and Under) -- Areas 60, 62-66
Units SoldVolumeAvg. Price/SFDOMAvg. Sale PriceHigh Sale Price

This representation is based in whole or in part on data supplied by the New Orleans Metropolitan Association of Realtors, St. Tammany Assoc. of Realtors, Tangipahoa Board of Realtors, Baton Rouge Board of Realtors or their Multiple Listing Services. Neither the Boards, Associations, nor their MLS guarantees or is in any way responsible for its accuracy. Data maintained by the Boards, Associations,or their MLS may not reflect all real estate activity.

02 February 2009

New Orleans Home Prices Up in the City, Down in the Suburbs.

by Kate Moran, the Times-Picayune Saturday, January 31, 2009

Resolute New Orleanians have stuck by their city in the face of poor schools, high crime and fearsome hurricanes, mortared here by the unique, soulful culture exemplified in its Carnival celebrations. That singular attachment to place appears to have buttressed the city's housing market during a time of widespread weakness.

After holding aloft during the early months of the recession, home prices across the New Orleans area began a retreat in 2008 that will likely continue this year. The exception was the city itself, where single-family homes gained an average of 4.4 percent in value. All of the suburban parishes, meanwhile, registered modest, if not catastrophic, price declines.

Wade Ragas, a consultant and former professor who prepared the survey of price trends for the New Orleans Metropolitan Association of Realtors, thinks the tide of insurance and rebuilding grants that flowed into the city after Hurricane Katrina helped insulate it from falling home prices. The longer a parish has been recovered, he ventured, the more it resembles wilting markets in other parts of the country.

Yet Ragas sees another factor in play. New Orleans and its institutions have always inspired fierce loyalty from residents who in many cases can trace their roots back generations. He points out that they question of where a person attended high school, often exchanged when city residents first meet, evokes a host of familial and social connotations that might not translate in new-growth suburbs on the north shore.

Ups, downs in Tammany

Ragas said St. Tammany Parish attracts executive types who want safe streets and good schools, but do not necessarily have an ancestral allegiance to the place. The metro area lost more than 85,000 jobs from the first quarter of 2005 to the same period in 2008, and Ragas said the north shore would have been particularly vulnerable to corporate relocations and consolidation in the oil and gas industry.

Still, total employment in St. Tammany Parish climbed by more than 7,000 jobs during that period.

Perhaps more than corporate relocations, the huge number of new homes that flew up in Tammany after the storm has contributed to the ebbing of home prices. Nearly 6,000 homes sold in the parish in the year after the storm, and builders responded with a crush of new construction. As single-family home sales dropped below 2,200 this past year, much of that inventory idled on the market.

"Some people who moved to the north shore after Katrina fixed their houses on the south shore and moved back. Some industries consolidated and moved people to other towns. The combination of corporate relocations and a little bit of overbuilding" has helped dampen prices, said Glenn Gardner, president of Prudential Gardner Realtors.

The slight drop in home prices should not trouble residents who have owned property on the north shore for a while, as they continue to enjoy the stunning equity gains they amassed after Katrina. Although prices fell 5 percent in Covington this past year, they remain 23 percent higher than they did before the storm.

It's more problematic for residents who bought during the 2006 bubble and now want to sell their home and return to the south shore. If they purchased a home with only a small down payment and values continue to tumble, they could be stuck with a mortgage worth more than the house itself: a microcosm of the bust that has afflicted states like Florida and California.

"St Tammany has the preconditions that breed foreclosure activity," Ragas said.

Loyalty to St Bernard

Councilman George Cavignac of St Bernard Parish said he has heard from constituents who want to return but feel trapped on the north shore because of their negative equity. Home prices waned by less than 2 percent last year in St Bernard, which nonetheless held up better than St Tammany, with its 6 percent decline, and Jefferson, with its 3 percent decline. Chalmette, where the largest number of sales took place, actually posted a 2 percent gain.

If Ragas' theory holds true, St Bernard outshone other suburban parishes because it elicits the same sort of brand loyalty that New Orleans does. Cavignac said prices have also held steady because they were artificially low before the storm. Residents of the tight-knit parish historically bought real estate from relatives who gave a discounted price, but the high cost of construction after Katrina has pushed values to a more market-driven standard, he said.

Although New Orleans was alone in posting overall gains last year, home prices showed more motley results when examined at the neighborhood level. Historic areas such as Uptown and the Garden District boasted strong appreciation, with average home price in the tony 70118 postal code topping $500,000.

Prices also climbed in recovering Lakeview, while dropping 11 percent in slower-to-rebuild Gentilly. Eastern New Orleans registered some of the most formidable price gains, largely because middle-income buyers can get more square footage for their dollar there than they can in the city's historic center, real estate agents said.

"It's also a very prideful community, much like St Bernard," said Arthur Sterbcow, president of Latter & Blum.

Encouraging signs

While several real-estate agents said 2008 was their dimmest year in recent memory, they pointed to some hopeful signs.

Although the volume of home sales plunged from 11,334 in 2007 to 8,126 in 2008 -- a decline of almost 30 percent -- prices fell by only 1.3 percent in the metro area as a whole. The region has also been spared the rampant foreclosures that continue to depress home prices in states like California, Florida and Nevada.

The nation's housing woes have nonetheless alighted on the New Orleans area in the form of more stringent lending standards. Sterbcow and others said the increased cost and difficulty of borrowing money has pushed some first-time buyers to the sidelines, gumming up the market for existing owners who want to sell their starter home and trade up to more affluent subdivisions in St Tammany, for example.

After holding steady for the first half of 2008, prices dipped in Jefferson Parish in all but one postal code by close of the year. Although the decline is partly tied to the lack of first-time home buyers, Lynda Nugent Smith of Keller Williams said updated houses in Jefferson and other parishes continue to sell. Buyers, perhaps impatient with the idea of home repairs after Katrina, are turning away from fixer-uppers.

"There is nothing new about Jefferson Parish anymore," said Smith, the risk management broker at the company's East Jefferson office. "Most of the inventory I see sitting on the market has the 8-foot ceilings, paneling and shag carpet. That's not what people want today."

Although 2008 proved a difficult year for real-estate agents, Margie Inman, broker-owner of Coldwell Banker TEC, said she has started to see a thaw in recent weeks, perhaps because of falling interest rates and a renewed sense of confidence spawned by transition in the White House. Sterbcow, of Latter & Blum, said traffic on his company's website has been strong.

If interest rates for borrowers with decent credit continue to hover around 4 percent in the coming year, Ragas said opportunities will abound for savvy home buyers.

"There could be unbelievable buying opportunities with falling prices and low rates," Ragas said. "It could be an incredible lift for the housing market."